Fixed book price for a better competition Catherine Blache, French - - PowerPoint PPT Presentation

Fixed book price for a better competition

Catherine Blache, French Publishers Association

I PA Congress

Bangkok, March 25th, 2015

Fixed book Price on p. books

• The book is not a product like others
• Fixed book Price on p. books in :

Argentina, Austria, France since 1981, Germany, Greece, Israel, Italy, Japan, Lebanon, Mexico, the Netherlands, Norway, Portugal, Slovenia, South Korea, Spain.

• Mostly laws
• Discussions in Belgium, Brazil, Poland,

Quebec and Turkey.

The necessity to avoid a price war

 The need to avoid the disappearance of

• bookshops. EX.: in PL, -300 booksellers.

 Objective: to create a level playing

field for all retailers.

 The French law of 1981 as an example:

• Price fixed by the publisher or importer
• Discount of 5% or 9% for public

authorities, schools, universities, libraries.

• A public policy in the line of the UNESCO

Convention on Cultural Diversity.

Preservation of one of the strongest network of booksellers in the world

 4.500 publishers  2.500 independent booksellers

1/ 26.000 inhabitants = 28% of sales (56% incl. chains)

• Equality of citizens in terms of access to

books.

• 600.000 books available, including 90.000

new books each year.

(Source: SNE stats)

“There are no books without booksellers”

 The demand for books:

Huge amount of products; prototypes; impulse buying.

 Booksellers’s fundamental role:

expertise and promotion

= > New authors and long-term life of back catalogue Thousands of titles in stock and qualified staff = > costs 29.500 titles/ 30K available via 300 booksellers in Quebec. 1/ 2 of sales : 1+ yr old books; a higher market share for HSS

Ex.:“L'Inconsolable” d'Anne Godard (2005,

• Ed. De Minuit), put on sale in January 2006

 Jan-March: creation of buzz by

booksellers:

80% of sales by booksellers 14% by chains of booksellers 2.8% by online retailers

 Mid-march: amplification of the buzz

already created by booksellers

50.5% of sales by booksellers 34% by chains of booksellers 9% by supermarkets and press points 2.5% by online retailers

Diversity of sales channels: diversity of books promoted

• Role of booksellers in the society and

for town and country planning.

“If a bookseller closes, it is the heartbeat of a city that stops.” Dany Lafferière

• Cross-subsidization = > diversity
• For booksellers: between best-sellers and

more specialized titles

• For publishers
• For authors

Devastating effects of discount

• On booksellers: fewer sales of best-sellers

and to libraries

 I n the UK: 600 towns without bookshops

• 1/3 of booksellers since 2005; Actors with

dominant positions 1.000 independent booksellers = 5% of the sales

 I n the US:

• ½ of booksellers in 20 years

2.000 independent booksellers = 6% of the sales

• On publishers: pressure
• On authors: difficulties for remuneration
• On readers: less advice

A positive measure for everyone

• Little « best-sellerisation »

In 2005, the top 20 best-sellers:

(Source: GFK)

1.7% of the sales of books in value in F, 16% in the UK; 20% in the DVD sector in F.

• A wider range of books sold/ read
• No inflation

1998-2008: ½ the increase of the consumer price index. 11€ in average for a book.

I n the UK: prices only went down on the best-sellers; book price rises : + 50%

since 1995 vs. + 28% for the cost of living.

(Source: Prof. F. Fishwick)

Fixed book Price on e-books to maintain a diverse and healthy distribution

The French law of 2011.

Consensus of the book chain and the State. Applies to all online booksellers, including foreign

• nes, selling e-books published by French

publishers to French consumers. Amazon and Apple are based in Luxembourg and Google in Ireland. Fixed book price on e-books in: Argentina,

France, Germany, Greece, I srael, Norway, Slovenia, South Korea and Spain.

Free Price on e-books

 Risk of pre-emption of nascent e-book

market by Web Giants.

 Web-giants are not booksellers

Goal: to sell the best-selling offer, so as to sell

• ther products and gain market shares.

 Downside effects of aggressive discounts

• n e-books in the US
• 90% market share for Amazon in 2009.
• Hachette 2014: 60% market share for Amazon

in the US, 78% in the UK

• Danger of monopolies
• Need to ensure a level-playing field for all

retailers.

Physical booksellers’s role for discoverability in the digital era

• I ncreasing market share of best-sellers

80% of the sales of e-books of RCS Libri = 23% of the titles in 2011 vs. 14% of titles in 2014 (Source: Marcello Vena, 2014)

• Online retailers cannot replace booksellers

and their promotion work

61% of book purchases by frequent book buyers in the US made online But only 7% of them had discovered that book

• nline. (Source: Codex group 2013)
• Need for both channels of sales and

promotion

The risk of censorship by actors with a dominant position

 Strong stakes of dominant positions

for access to culture

 Cases of censorship by Apple:

• French-Belgian comics with nudity
• Danish app about hippies

 Amazon discouraged readers to buy

Hachette US and Bonnier Germany books

• Danger for cultural diversity
• Matter of democracy

The need for a regulation

Competition law is not sufficient

 Only ex-post  Cost of litigation  Fear factor

• A cultural policy for a greater

diversity of books bought

Thank you!